23 Jun, 2024

Volvo may hand Polestar stake to its parent Geely

Polestar would need to inject an additional $1 billion over the next 12 months to keep it afloat, analysts at Bernstein said in a note last week, advocating the nameplate should not be independently listed.

Polestar last week said it plans to cut about 450 jobs globally, or about 15 percent of its workforce, amid “challenging market conditions.”

It also said in November that it would try to reduce its reliance on external help, publishing a revised business plan, which included getting additional loans from Volvo and Geely.

The news could raise questions about the viability of Polestar, which aims to become cash flow break-even in 2025. Some analysts have said it could make more sense to fold Polestar into Geely.

Volvo’s battles

Volvo, which previously owned Polestar as a sporty sub-brand, has been fighting its own battles and last year started to cut 1,300 jobs, part of a drive to reduce costs across global operations.

The automaker is also dealing with software development issues that have delayed the brand’s new electric EX30 and EX90 models.

Volvo on Thursday reported a bigger than expected rise in fourth-quarter operating earnings, posting operating income excluding joint ventures and associates of 6.7 billion

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